Here is what Turnquest is saying:

In traditional banking in civilised countries, the "spread" is a lot more equitable to the consumer.

Here is a concrete example: You deposit $1000 into an interest bearing account. The bank agrees to pay you X percent on your $1000. Another customer comes into the bank. They want to borrow $1000. The bank lends them the money at X plus Y percent. That is the spread. Then they pay you the X on interest for your deposited monies, and they keep the Y percent as profit for lending out the money.

In the Bahamas, when you deposit your $1000 dollars, the bank pays you 1.34 percent on your money. Then they lend out the money and lender must pay 12.1 percent for that $1000 that costs the bank only 1.34 percent to hold. That is the spread. In this case, it is 10.76 percent difference.

In say Canada, the bank pays interest at about 1.12 percent and charges 4.8 percent to borrow that money, for a spread of 3.68% instead of the 10.76 percent gouge that the banks in the Bahamas are charging.

However, I don't have a problem with the huge spread in a small economy like ours. The real problem behind the mortgage defaults is as ondrap4 says. There is no credit bureau, and everyone gets credit from Kellys to whatever and it gets subtracted at the source from their payroll cheques. Bahamian personal debt is through the roof, and there is really no way of assessing it, because of source deductions from a variety of places -- all non-reported.

The banks aren't the source of the problem here.

My SME and large business clients have been doing exactly what you describe since 2006 -- disposing assets, moving networth exposure offshore, economic passport, etc etc. And their story is the same -- their former assets are worth a fraction of what they were in 2006.

Suppose God created a rock so heavy that he can't lift it?

Suppose that the state of the Bahamas is so deeply corroded by its endemic problems, that it cannot be fixed?

We need to create 10,000 jobs that pay decently just to move the yardsticks, and not by very much.

We need reform and downsize the civil service.

We need to rehabilitate a couple of generations of young Bahamian males who are chronically unemployed and inculcated into the gun culture.

We need to reform taxation.

We need to reform the justice system.

We need to upgrade the literacy of our human capital.

Tough tough problems to solve with a country deeply in debt, and leaders who don't have a clue.

Priority #One is to create 10,000 jobs with the people that we have now.

It's a sign of the times. Desperate people do desperate things to get money.

LBT: It's too bad that you never followed your own hypocritical empty words of "Forward Together". You certainly never displayed that for the FNM party. Rather your machinations have almost torn apart any immediate hope of redemption for the Bahamas.

At the expense of your party and of the country, you have pushed forward your own sense of entitlement. You lost the leadership convention in a fair, democratic vote, and so you worked to undermine that democratic process. You do not possess the necessary humility and greatness to be a leader. You do not possess the vision. You do not possess the talent. You do not possess the statesmanship, especially when it came to slapping another member of Parliament.

The words of that the prophet Daniel interpreted apply to you: mene, mene, tekel, parsin, meaning:: MENE, God has numbered the days; TEKEL, you have been weighed and found wanting; and PERES, the kingdom is divided. You have sown those seeds of division and discord.

It's easy to point out what is wrong with the corrupt, ruling party. But the bigger task is to fix this beloved country, and frankly my dear, you haven't a clue. You have demonstrated that you are incapable of being a servant, therefore you are unqualified to hold the highest office as servant of the people.

Being political and being biggity is not what is wanted here. We need a great leader, and a great leader is also a great person. You are not a great person. Please take your yappity yap elsewhere.

There is not one shred of policy, one shred of vision or one iota of a plan to rescue the Bahamas in your screed, that shows that you are worthy of anyone's support.

Jokes.

http://tribune242.com/users/photos/2016…

Anyone know how his bowling alley is doing?

This would only work if:

1) You revamped the work permit process to make it fast (within two weeks) and automatic

2) You allowed foreign lawyers to operate here

3) You re-vamp the business licencing process to make it a nominal fee ($500) available over the internet

4) You eliminate exchange controls

5) You lower the cost of energy

6) You make Nassau a safe place to live

This is just the bare minimum to compete with other places.

What the government hasn't realised, is that they have loaded up the Bank of the Bahamas with a toxic asset (ie. the bond that Resolve will default on). The corollary are the bonds issued in the sub-prime debacle. BoB has valuation and capital assets on their books that are smoke and mirrors and not worth the paper that they are printed on. This is beyond belief.

What blows me away, is how all of this is smoke and mirrors.

The Bank of the Bahamas is not compliant with Central Bank in regards to key capital minimum ratios. So to rescue it Resolve, issues a bond to cover the amount of bad loans to BoB. All of a sudden, BoB is good again.

Bank of the Bahamas puts this bond into their pot, and voila! -- the minimum capital issue goes away, because theoretically, the bond from Resolve is like cash --it can be a negotiable instrument -- if anyone was stupid enough to buy it.

But here is the problem. The bad loans are backed by properties with "book value". Someone pledge a property as collateral for a $15 million dollar loan, so the book value of the property is marked as $15 million. In reality, the property is worth say $5-$8 million maybe, if a gullible buyer can be found.

So even if Resolve manages to sell the properties, it still will not cover the bond.

Now, not only will the Government be on the hook to cover the bond, they must also pay the interest to BoB that Resolve owes BoB on the bond. Good money after bad!

The hope was that Resolve sells the properties, pays off the bonds and everyone is happy. But you have to remember that this is the kleptocratic PLP - (two for me and one for you) and they are math-retarded.

Rather than do a book valuation, they should have done a quick market evaluation for the bond, and wrote down the difference from BoB's books. That way, Resolve would have at least a chance of working. Instead, the fecal-matter-for-brains geniuses blithely issued a bond that they knew would default, but it looked politically expedient at the time. And Deloitte aka Raymond Winder (where have I heard that name before ... baha ... baha ... baha . ha ha ha ha mar ) collects another couple million in fees.